Five steps to an adaptive strategy

What is an adaptive strategy?

Charities and funders have always had to adapt to changing need. However, traditional strategy approaches have seen organisations set detailed objectives, make extensive plans, and even restructure their entire organisation based on fixed-term strategies. For anyone tasked with strategic decision-making, the past few years have felt like one crisis after another: Brexit, Covid, the cost-of-living crisis, and climate change. And yet we see charities adapting, reprioritising, and finding ways to navigate the ever-changing context for their work, while keeping their mission, as well as the people and places that they support, at the fore.

In an era of permacrisis, fixed strategies have limited value. Instead, strategy needs to become a process of ongoing decision-making. In such a context, you need to know where you’re going, but the exact route to get there may not be mapped out in detail.

This is often called an ‘adaptive’ or ‘agile’ approach to strategy. Others talk about ‘being responsive’, ‘being more flexible’, ‘a test and learn approach’, or needing to be ‘nimbler’. While the language to describe this approach varies, the overall concept is steadily becoming the norm in the social sector.

An adaptive strategy responds to the challenge of permacrisis through an iterative process of planning and budgeting, guided by a strategic framework.

Adaptive strategies can flex to suit evolving conditions; however, this doesn’t mean abandoning planning altogether. Each organisation will need to decide where it sits on the continuum from light touch to planned, and everything in between. The exact format of your approach will depend on your culture, funding sources, and the issues that you are tackling.

What is common across all organisations is that an ‘adaptive strategy’ means taking an approach to strategy development and implementation that is:

1. Regularly informed by up-to-date information.
2. Built around a core strategic framework.
3. Implemented iteratively.

Done well, an adaptive strategy can reduce the need for regular strategic reviews, instead embedding systems and processes that keep your strategy closely aligned with needs as the world evolves.

Step 1: Designing an adaptive strategy

The first step on your journey is deciding to take an adaptive strategy approach.  As part of this process, it is important that senior staff and trustees all understand what an adaptive strategy approach is and how this will vary from current practice. In particular, the intention to develop a core strategic framework where implementation is planned and delivered iteratively.

It is helpful to clearly articulate and agree the reasons for using an adaptive strategy approach, what benefits it is expected to bring, and what success will look like. This ensures that everyone is ‘on the same page’ and reduces the chances of mismatched expectations.

You will need to decide who will be involved in developing the strategy, including who will project manage and what the sign-off process will be. This is the point when organisations typically decide whether or not to appoint a consultant to bring in adaptive strategy expertise and wider sector knowledge.

You will also need to identify a ‘core team’ who will be involved in the practical steps of the strategy’s development. It helps if this core team is a consistent group, engaged in the strategy development process from start to finish. They will be the people who participate in deliberative workshops to develop your strategic framework.

Often the core team is composed of trustees, and senior staff. Other stakeholders that might be invited to participate in some or all of the core group’s development work include:

• People with lived experience.
• Representatives from partner organisations.
• Key internal staff (such as those involved in finance, fundraising, or core activities).

Who is and is not included in the core team is important to consider alongside wider stakeholder engagement and communication. This is to ensure that you take people with you on your journey and have the right expertise in the room.

Identifying your timeframe is another key part of the planning process. The ideal timeframe is one that allows opportunity for reflection but is not so long that it dominates organisational life, which can result in people putting work on hold or continuing work without a clear direction.

Depending on the size and complexity of your organisation, a good timeframe is often 4 to 12 months. Who is involved and how, has a significant impact on the time required for the process. As a general rule-of-thumb, the wider the engagement the better the final product. Agreeing stakeholder involvement will help you to plan how much time you need.

Step 2: Insight gathering

Adaptive strategy is an ongoing process of decision-making based on the most up to date information available. Gathering data at the outset of developing an adaptive strategy ensures that everyone involved in the process has access to the same up to date information.

Areas for collating information include: data relating to unmet need, previous outcomes and impact, feedback, sector trends, potential competitors or collaborators, organisational strengths, and the budget situation or ‘financial envelope’ for the time period the strategy will cover.

The process also helps you to work out what ongoing data gathering and interpretation will be needed to keep teams up to date during implementation, and therefore keep the strategy responsive and adaptive.

This early data also sets the baseline for future analysis and evaluation. At every stage of an adaptive strategy’s development and implementation, you should aim to make decisions based on the best available information at the time. This should include both lived and learned experience, as well as quantitative and qualitative data.

Proportionality and pragmatism can help guide your choices on what type of data to collect and to what depth. As the saying goes ‘perfect is the enemy of the good’–perfect data and solutions do not exist and considering where to draw the line on ‘good enough’ data is an important strategic leadership skill.

Data and evidence gathering is not the aim itself. Take the time to explore what the data means and translate it into ‘insights’ for discussion and to inform decision-making. For example, trends and what they mean for you. Triangulate data from different sources and perspectives where possible, ensuring you have a shared understanding of the underlining organisational beliefs and culture.

Issues that will affect all organisations and should appear in your insight gathering, regardless of your areas of focus and expertise, include:

• Diversity, equity, and inclusion (DEI): For more information, start with the Office for National Statistics Centre for Equalities and Inclusion, which aims to improve the evidence base for understanding equity and fairness in the UK, and NCVO’s ‘Get Started with Equity Diversity and Inclusion’.
• Poverty and socio-economic disadvantage: For more information, start with the Joseph Rowntree Foundation’s regular analysis of poverty trends in the UK.
• The social impacts of the climate and nature crises: For more information, start with NPC’s analysis of how different social groups are impacted by the environmental crises.
• Technological advancements, including AI: For more information, start with Charity Digital’s resources on AI in the charity sector.

Thinking about poverty, socio-economic disadvantage, the experiences of people with varying protected characteristics, and wider inequities is essential if you want your organisation and its work to be for, and representative of, everyone. This is because we know that some people face higher barriers to inclusion, even if they are not intentionally excluded.

Thinking about the climate and nature crises is also vital, as we all have a responsibility to build a healthier, fairer, and more sustainable future for everyone. The climate and nature crises, as well as technological advancements such as AI, are areas of rapid change to which your strategy will have to adapt and respond over the coming years. Even if they are not impacting you now, or you are unsure of what the future impact will look like, an adaptive strategy will ensure that you are prepared for the changes to come.

The interrelated nature of the systemic issues that charities and funders support require integrated action to find solutions. To find out more about systems practice and how to think more systemically, take a look at our free Systems Practice Toolkit.

The best insight gathering processes include conversations with other charities, grantees, funders, and people with lived experience. Not only does this support systemic thinking, it can also support tough prioritisation decisions by increasing understanding of where you can add the greatest value in the system.

Step 3: Developing a strategic framework

A good adaptive strategy needs to be clear. The rest should be flexible and adaptable. At the centre of an adaptive strategy is the ‘strategic framework’ that is to say, your vision, mission, values, goals and enabling objectives. This strategic framework is your ‘north-star’: a high-level articulation of your organisational identity and the overarching change you want to achieve to guide the implementation of your adaptive strategy.

If you are not thinking long-term, you are less likely to make an impact. Change is rarely swift and frequently complex. Therefore, a responsive but impact-focused strategy requires a timespan of around 10 years.

Vision, mission, and values statements are often set with a 50-year horizon, and you should expect to review them every 10 years.

Goals and enabling objectives are often set with a 10-year horizon, and formally reviewed every 3-5 years—although they are frequently considered throughout yearly work plans.

In this section of the guide, we will look at how to develop each component of your strategic framework.

Vision

Your vision statement should describe the world your organisation exists to help create. It should reflect what life will be like for people, places, or the issue that you support.

A common mistake in crafting vision statements is including what your organisation will do, in effect creating two mission statements.

Mission

Your mission statement should describe the unique reason that your organisation exists and how you will contribute to achieving the world described in your vision statement.

A common mistake that organisations make when crafting mission statements is to include too much information, creating a mission paragraph rather than a mission statement. This reduces clarity and might stretch into information that should be captured at goal level.

Values

Your values are unique to your organisation and should describe the way you believe work should be done and the standards to which you hold yourselves.

To be responsive to change, adaptive strategies require clear principles to underpin decision-making throughout implementation. If done well, your values statements can fulfil this role.

However, in order for your values to support decision-making they must reflect the standards to which you hold yourselves. Good values reflect how we believe our work must be done to generate the impact we are working towards. Therefore, they establish a standard to which you hold yourself. For example, you may decide that all work must be ‘user led’ and will take decisions based on that commitment.

Values can either mean ‘the regard we place in something’ or ‘the standards to which we hold ourselves’. A common mistake that organisations make when developing their values is to muddle up the two definitions. Only the latter definition is useful for decision-making. For example, you can hold being ‘hard-working’ or ‘passionate’ in high regard, but neither will help guide you in decision-making.

Goals

Your goals statements should describe specific areas of focus that will help you to work towards your vision during your strategy timeframe.

The most common mistake that organisations make when writing their goals is to try to represent every programme and project that they are working on in their strategy document. This often muddies the waters. Much of this detail is better articulated in operational team plans.

For an adaptive strategy, the goal needs to be high-level and clear, but not so rigid that the route towards reaching your goal is unable to flex in response to unexpected detours.

Enablers

Your enablers should describe how you will ensure sufficient capacity and capability to implement your strategy.

There are certain things that your organisation needs to make your strategy work. Things like technology or staff time. ‘Enablers’ are projects or pieces of work that allow you to build or grow these things.

Obviously, each organisations’ needs will be different. But some ‘enablers’ might be:

• Building organisational capacity, particularly for fundraising and increasing income.
• Introducing digital technology to improve efficiency.
• Improving processes for learning, such as evaluation or centring lived experience.

A common mistake that organisations make when developing enablers is to underestimate the resources required to achieve the goals. Some common examples include minimising core costs because of the difficulty of funding such work, underestimating the amount of collaboration required, or underestimating the time it takes to get the enablers in place.

Step 4: Finalising your adaptive strategy

The process of writing up, honing, and agreeing your strategic framework is an important stage that requires planning and time.

The following activities move your strategic framework to a finalised adaptive strategy document ready for sign off.

Assessing resources and capabilities

Not all financial resources will be in place at the outset of implementing an adaptive strategy. However, the board of trustees will need a level of confidence that the strategic framework will be affordable to deliver, while meeting the needs of and being well received by key stakeholders. Decisions in this space are supported by robust financial analysis, as well as decisions about risk appetite and non-negotiable issues (‘red lines’).

Prioritising

For most organisations, there will always be more to do than time and money available. There is a strategic risk of being spread too thinly and not making progress on the things that matter most.

This also brings operational risks around staff feeling overwhelmed and burning out. It is difficult and often emotive to prioritise and deprioritise. However, identifying a framework to guide prioritisation will support you during the finalisation and implementation of your adaptive strategy.

The list of criteria, and the weighting between criteria, will look different for each organisation. Agreeing criteria is often not straightforward, but the process of debating and discussing it can be valuable in creating a shared understanding, allowing you to navigate contentious decisions during implementation.

Sense checking your adaptive strategy with stakeholders

Sense-checking your draft strategic framework with stakeholders before its finalisation helps to increase quality, impact, and buy-in. Sharing a first draft provides you with an opportunity to sense-check how well your strategy will be received by key stakeholders (the people you work with and for, grantees/funders, collaborators, and peers) and get their views on whether it plays to your organisation’s strengths and role in the ecosystem.

Writing up and communicating your strategy

Writing up your strategic framework and any accompanying information is likely to require several iterations, with feedback from relevant stakeholders prior to sign-off. It is therefore important to think about style, format, and mechanisms of communication internally and externally to ensure that it is easy for stakeholders to understand.

Step 5: Preparing for implementation

Adapting your planning and budgeting

Implementing an adaptive strategy requires an iterative process for detailed planning and budgeting. Your annual planning cycle takes on even greater importance under an adaptive strategy, becoming less about assessment of ‘progress against plan’ and more an iterative process of translating your adaptive strategy into concrete plans for the next cycle. Your strategic framework remains your guiding ‘north star’ throughout, and your prioritisation criteria will support decision-making.

Detailed planning for the year ahead is essential. It is also helpful to have indicative plans for the next two years. This ensures that the year ahead is placed within a longer-term understanding of how it contributes over time to the strategic framework, and takes account of longer-term programmes and funding cycles.

Some organisations operate a rolling cycle of one year planning refreshed quarterly, so that plans are always in place for the subsequent 4-5 quarters.

Adapting your data and insight gathering

Some of the most fundamental changes under an adaptive strategy approach are how insight is used and progress is reported. Data and insight gathering becomes a more regular activity. It is essential to have clarity on what types of data should be gathered to support decision-making to avoid collecting data which is rarely used. A measurement framework based on a robust theory of change can help you to do this.

Agreeing who is responsible for the analysis and interpretation of data is essential. Successful insight generation requires diverse perspectives from different levels within your organisation, alongside the views of external stakeholders and the people that you support. Building a consistent, clear, and proportionate process for insight generation is central to effective adaptive strategy implementation.

Moving to a more frequent insight gathering process can positively impact both the practice and culture of teams. The first common change that organisations make is increasing the value of insight from frontline teams delivering services and programmes, as it is frequently those on the frontline who are the first to see changes in the external environment. This can require a culture shift to empower teams (often accustomed to being ‘told’ how to implement) so that they feel confident offering their insights into decision-making processes.

The second common change that organisations make is providing an increased role to the people that they support (service users or beneficiaries) in order to encourage their experience and insights. To enable this, it is important to de-jargon language to improve inclusivity and clarity.

Adapting your reporting and governance

Traditional power dynamics within organisations can alter under an adaptive strategy as insight gathering and decision-making moves closer to implementation level. This has ramifications for governance and leadership, as well as donor reporting.

To be more responsive in your approach, you will need more flexibility in your funding. It can be helpful to explore a separate unrestricted fund within your budget to facilitate in-year changes of direction or new action. Funders can support more flexibility and adaptability through the provision of long-term, unrestricted funding.

Preparing for implementation is the time to consider questions, such as: ‘how do we provide strategic clarity for our teams without dictating direction?’ and ‘how will the board know that the organisation is on track for successful strategic implementation?’

Under an adaptive strategy, trustees will continue to have legal and moral responsibilities in steering their organisation’s fiscal competence, legal compliance, and impact. However, they will need to get comfortable with more uncertainty than perhaps they are used to.

Arguably this has always been the situation, which is why traditional strategy conversations so frequently include discussions about ‘pivoting’ or similar phrases about refreshing the direction of travel.

One of the benefits of an adaptive strategy approach is that this flex is built into the process in advance through open and honest discussion, with agreed expectations among stakeholders.